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After paying the trustee do I continue paying my car loan?
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After Bankruptcy
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Whether you have to keep making payments on your car loan depends on what type of bankruptcy you file, whether you want to keep the car, and other factors. A car loan is a secured debt, which means that the lender has the right to repossess the car if you default. Whether you file for bankruptcy under Chapter 7 or Chapter 13, your personal liability to pay back the loan will be discharged in bankruptcy. However, the creditor's right to take the property will survive your bankruptcy case. So, if you want to keep the car, you'll have to satisfy the creditor's claim.
Car Payments in Chapter 13
If you file under Chapter 13, you can make up any car payments you've missed through your repayment plan. This means you can pay them off a bit at a time, rather than all at once. As long as you pay off your arrearage and continue making your required monthly payments on the car, you'll be able to keep it. Depending on the circumstances, you may even be able to cram down the loan so you owe only what the car is worth, if you enter bankruptcy owing more than the car's value.
Car Payments in Chapter 7
To keep your car after your Chapter 7 bankruptcy case, you'll need to either redeem the car (by paying the creditor what it's worth, in a lump sum) or reaffirm the debt (by agreeing you will still owe it after your bankruptcy case is over). Some creditors will allow debtors to keep a car without reaffirming the debt, as long as they make their monthly payments. There are pros and cons to each strategy. But the bottom line is this: If you want to keep your car, you will have to pay the creditor for the privilege.
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